Why did the United States suppress Huawei and TikTok? Why is it difficult for the U.S. manufacturing industry to return? Why does Yellen mention overcapacity?
Nowadays, many media and official reports have come to a corresponding conclusion on the above issues, but in the eyes of American economist Michael Hudson, there is an unknown truth behind these problems.
Who is Michael Hudson? This is no ordinary person.
He is a Ph.D. from New York University, a world-renowned economist, director of the Institute for Long-Term Economic Trends in the United States, and a professor at the University of Missouri-Kansas.
His books include "Super Imperialism: The Sources and Foundations of American Financial Hegemony", "Global Fragmentation", and "Trade, Development, and Foreign Debt".
Here's what he had to say –
Truth 1: Why are Huawei being suppressed? Because the benefits have been taken away
The United States is not afraid of the competitiveness of the goods produced in China, and it is not worried about occupying most of the American market.
The United States is unhappy that in China, the companies that produce these goods can not be controlled by the United States, and their shares do not have the United States, or the key components they use are not American.
According to this logic, Huawei is the most typical enterprise in China.
Huawei occupies the high-tech communications market that the United States most wants to monopolize, and its competitiveness is very strong, and the United States cannot obtain a stake in Huawei, plus Huawei does not allow the US National Security Agency and the CIA to open a backdoor in its communications products, and cannot spy on others through Huawei products.
Therefore, the United States is bound to suppress it.
Truth 2: The core of Ming grabbing TikTok is to control all social media
Why TikTok can win the love of most people in the United States, because Chinese follow a long-term investment strategy, Chinese capital will be willing to invest most of the money earned into product optimization, thus creating a complete self-optimization system.
But the concept of American capital is different, and most American capital follows a short-term financial strategy, that is: see a good product, then buy a share, buy the product directly, and control the chicken that lays golden eggs.
What worries the United States even more is that TikTok also rejects American censorship, has a lot of influence, and allows people to speak freely. For example, for every three authentic pieces of content about the Israeli-Palestinian conflict on TikTok, there is only one on Instagram.
In this way, the United States really can't bear it: I can't compete with you, and I can't control you, so okay, I can only issue a law to force you to sell, buy you, and I can control you, and I can still make money, why not.
Truth 3: Regarding the return of manufacturing, enterprises that do not practice internal skills are destined to only buy and buy
Then we talked about manufacturing industries such as steel, shipbuilding, and automobiles.
American steelworkers and auto workers always shout that their jobs have been snatched away by the Chinese. He also said that the weakness of the United States in core industries will affect national security.
But the fact is that from the Reagan era in 1980, the United States began to implement a monetarist policy. When other countries, including China, are becoming more and more efficient and cost-effective in manufacturing, capital is naturally reluctant to pay high prices for its own production, but tends to buy and buy.
As American workers seek to improve health care, housing, and other benefits, they do not make an effort to improve their own input-output ratios, resulting in competitiveness lagging behind not only China, but most countries.
Today, China's shipbuilding industry is 100 times larger than that of the United States, and the scale effect is far ahead.
Truth 4: No U.S. business is willing to accept low profits for a long time
At this point in time, the manufacturing industry in the United States wants to rise again, but it has disadvantages in many aspects.
For example, the United States does not have an advantage in the number of graduates who graduated from science, technology, mathematics and other disciplines;
For example, in terms of supply chain efficiency, most of the supporting industries of the core manufacturing industry are in East Asia, and the United States does not have an advantage;
Crucially, it is almost impossible for U.S. companies to reshore manufacturing if they want to reshore manufacturing, which is almost impossible. Then the U.S. government can only provide subsidies if it wants to guide the reshoring of manufacturing.
Truth 5: Yellen's "overcapacity theory" is actually the self-righteousness of the United States
Speaking of subsidies, it is necessary to mention Yellen's accusation that China monopolizes clean energy products, battery technology, and low-cost exports through subsidies, which she said the U.S. industry can't compete with, so China must stop exporting these things.
I would like to ask rhetorically, why not let American consumers enjoy the good and cheap goods sent from China. Believe me, there is no foreign government in the world that would spend money to subsidize another country with a market as large as the United States, and no one can afford to subsidize it.
Any government subsidies and support are only to guide the development of related industries in their own countries in a certain direction in a certain period, which is no different from the bill in the United States that allows chip companies to build factories in the United States.
The central issue here is that China's ability to produce these goods at a lower cost essentially means that China's production capacity is much higher than that of the United States. So why can the Chinese do it? Shouldn't we learn? If we really can't compete in one field, we should highlight our advantages in other fields and achieve global industrial complementarity.
Therefore, for the United States, the best strategy is to let go of the self-righteous and domineering frame, learn from the strengths of others, or find your own strengths, and develop with all your might, instead of desperately driving up the stock price and playing the money game.
What are your thoughts on the above points?
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